GPS ANNOUNCES PROPOSED ACQUISITIONS OF TRUCKINGCOMPANIES.

ATLANTA--(BUSINESS WIRE)--May 23, 1997--

COMPANY ANNOUNCES DEBT-FOR-EQUITY EXCHANGE; GPS REPORTS FIRST

QUARTER RESULTS AND ANNOUNCES NAME CHANGE IN CONNECTION WITH NEW

STRATEGIC DIRECTION

General Parcel Services, Inc. (Nasdaq Small Cap:GPSX) today announced

that it has executed non-binding letters of intent to acquire four privately held trucking companies in separate transactions. Philip A. Belyew, President and Chief Executive Officer of the Company, said the proposed acquisitions involve profitable short- and long-haul truckload companies based in the southeastern United States. The four companies have combined annual revenues of approximately $100 million and are to be purchased for cash and stock having an expected total value of $30 to $35 million.

Belyew said the letters of intent are subject to due diligence, execution of definitive acquisition agreements, arrangement of financing, and other customary terms and conditions. The Company expects to complete the acquisitions during the third quarter of 1997.

Separately, Belyew announced that as part of the Company's strategy to emphasize the growth opportunities that it believes exists in the truckload and less-than-load (LTL) motor carrier industry, the Company will change its name to Transit Group, Inc. effective June 30, 1997.

"We are very pleased and excited to announce these proposed acquisitions, our first major step in changing the strategic direction of our Company since the new management team and Board of Directors was installed in January 1997," Belyew said. "These acquisitions, provided they are consummated as planned, will give us a substantial base of operations in the truckload and LTL industry and, we believe, will enhance our ability to capitalize on the significant opportunities we believe exist for consolidation in the trucking industry. Moreover, our new holding company structure now headquartered in Atlanta will greatly facilitate this type of expansion."

Belyew noted that General Parcel Service's acquisition criteria remains focused on mid-size trucking companies, primarily those with annual revenues between $10 million and $100 million. "We continue to search for profitable trucking companies that have quality management, strong market positions, and a commitment to a high level of service and quality. Each of the four companies that we propose to acquire meets these high standards and will continue to operate separately with existing management." With its holding company structure, GPS offers a high degree of independence for the trucking companies it acquires while the Company achieves greater diversification of customers, geographic regions and the opportunity to realize operating synergies on a larger business base, he added.

Belyew also announced that the Company has agreed to a debt- for-equity conversion that will virtually eliminate its long-term debt other than debt associated with equipment which the Company expects will be eliminated by the end of the third quarter. T. Wayne Davis, Chairman of the Board and majority shareholder, and his affiliates have agreed to assume approximately $5 million of the Company's debt in exchange for the issuance of approximately 2.86 million shares of new common stock. Additionally, as part of the Company's strategy to concentrate on the truckload and LTL industry, the Company also has agreed to divest its courier operations to Davis as part of the debt-for-equity exchange. This courier business, based in North Carolina, accounts for approximately $1 million of the Company's total annual revenue. Final determination of the amounts involved in the exchange, which is expected to be completed by June 30, 1997, are subject to pending asset sales which will extinguish certain related debt. Belyew noted that the elimination of this debt is a necessary step for the Company to obtain financing for the pending acquisitions.

Belyew pointed out that the Company recently received a capital infusion of approximately $1.2 million from Davis and other key management in exchange for new restricted shares of common stock. Davis currently owns approximately 51% of the Company's outstanding common stock and will own approximately 69% after the debt-for-equity conversion is completed. Prior to the capital infusion and debt-for-equity conversion, the Company had approximately 3.8 million common shares outstanding.

Commenting on these capital transactions, Belyew said, "We are very grateful for Wayne Davis' continued commitment to the Company and his ongoing confidence in the new direction in which we are taking our operations. His additional equity stake, resulting from both his recent cash infusion and the debt conversion, will provide us with greater financial strength and flexibility to pursue our acquisition goals."

Lastly, the Company announced its results for the first quarter ended March 31, 1997. Revenue for the period totaled $5,064,992 versus $5,783,671 in the year-earlier quarter. The net loss for the quarter was $2,528,830 or $.72 per share compared with $474,316 or $.14 per share for the first quarter of 1996. The net loss for the first quarter of 1997 included a pre-tax loss on discontinued operations totaling $1,048,086 related to the closing of the Company's North Carolina and South Carolina facilities. For the year ended December 31, 1996, the Company reported a net loss of $5,149,357 or $1.48 per share on total revenue of $23,404,409.

"We continue to evaluate several alternatives to return the Company to profitable operations and positive cash flow," Belyew said. "The closing of our North and South Carolina facilities was a major step in this direction, as is our proposed entry into truckload and LTL trucking and the disposition of our courier operations. In the coming months, we intend to make further changes to our remaining parcel delivery operations, either reducing their size to a level that can achieve profitability or eliminating them through sale or discontinuation. Either way, our focus for the future is clearly on the truckload and LTL industry."

Comments in this news release regarding the Company's business which are not historical facts are forward looking statements that involve risks and uncertainties. Among these risks are that the Company is in a highly competitive business, has history of operating losses, and is pursuing a growth strategy that relies in part on the completion of acquisitions of companies in the trucking industry. There can be no assurance that in its highly competitive business environment, the Company will successfully improve its operating profitability or consummate such acquisitions.

General Parcel Service is a holding company focused on growth in the truckload and LTL motor carrier industry. The Company, with headquarters in Atlanta, Georgia, currently has operations in Florida and Georgia. -0-

                 GENERAL PARCEL SERVICE, INC.
               (Unaudited Financial Highlights)


                                         Three Months Ended
                                              March 31,

                                         1997          1996
Revenue                               $5,064,992    $5,783,671
Net loss                              (2,528,830)     (474,316)
Net loss per share                          (.72)         (.14)
Weighted average shares outstanding    3,758,671     3,758,671

CONTACT: General Parcel Service, Inc.

Philip A. Belyew, 770/984-5365

or

Wayne N. Nellums, 904/363-0089